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Sinopec Sets Timetable for Inviting Outside Investors

Fu Chengyu, chairman of state-owned oil giant China Petroleum & Chemical Corp. (Sinopec), said it will release a detailed plan on how it will invite private capital into its sales unit in June and complete fundraising in the third quarter of this year. 

Sinopec said in January that it would restructure its sales assets, estimated to be worth over 300 billion yuan, to introduce non-state investors in a pilot in which no less than 30 percent of a new sales company will be offered to outside investors. Sinopec is to set up the company on March 31 and complete a comprehensive audit on it by the end of June, Fu said. Sinopec's sales business contributes 35 percent of the company's total profits.

 Sinopec

Another oil giant, China National Petroleum Corp. (CNPC), has also promised to invite private and other non-state investors to jointly develop blocks with estimated reserves of 600 million tons of oil. The company said it would allow investors to hold up to 49 percent of the projects.

The news has excited the market because both companies have offered up their best assets for the pilots. Industry experts said Sinopec's assets in refining and sales are quite competitive, while CNPC is stronger in upstream oilfield development.